Does the Trend Toward Digital Paywalls Affect You?

Quebec WallAlthough The Wall Street Journal offers some free content, it launched its digital edition in the mid-90s with a paid subscription model.

As of September 2011*, more than 537,000 readers were paying for online access, with 80,000 of these accessing content through tablets, smartphones or e-readers.

Other news organizations may not offer the specialized business information that some characterize as key to The Wall Street Journal’s ability to charge for content, but more of these outlets have also migrated to, or are considering, the paywall model.

With severe declines in print advertising revenues — from $49.3 million in 2006 to $23.9 million in 2011 — the newspaper industry is exploring alternate strategies to generate revenue and steady shaky bottom lines.

On the rise
The recently released Pew Research Center Project for Excellence in Journalism‘s “State of the News Media 2012” report highlights the move to digital subscriptions as a trend for the year ahead. In fact, it notes “as many as 100 more papers are expected in coming months to join the roughly 150 publications that have already moved to some kind of digital subscription model.”

In 2011, The New York Times announced a metered model. With 454,000 paid digital subscribers, the company has made progress in its goal of developing alternate revenue streams.

Now, a year after introducing the metered model, the New York Times has made additional changes. Widely noted this month was the reduction in free articles for non-subscribers from 20 per month to 10.

Recently, the Los Angeles Times also shifted to a metered model. And publisher Gannett plans to tighten access to its content by establishing paywalls at its digital news publications, with the exception of USA Today.

Notably, one major U.S. newspaper, The Washington Post, has not instituted a paywall, keeping its focus on increasing online traffic and improving technology.

Is it a future option? “Not in the short term, and maybe never, if I read the tea leaves correctly,” writes ombudsman Patrick B. Pexton on March 23, 2012.

Challenges
Internet users have come to expect free content and have multiple choices for accessing news outside the paywalls. Will they be willing to pay for digital subscriptions, and if so, how many subscriptions will they use?

One thing is certain. Whether paid or free, the trend toward accessing news digitally will only accelerate.

The Pew’s report notes that a “growing number of executives predict that in five years many newspapers will offer a print home-delivered newspaper only on Sunday, and perhaps one or two other days a week that account most print ad revenue.”

This tracks closely the prediction from Jeffrey I. Cole, director of USC Annenberg’s Center for the Digital Future, who said that in five years most newspapers will be gone — the print survivors will be the largest and the smallest publications.

Think differently
Some analysts encourage a more reader-centric approach — what Matthew Ingram writing in Gigaom terms a “velvet rope.” This model focuses on building reader engagement first and only then seeking revenue generating opportunities.

Now it’s your turn. What has been your experience with paywalls? Are there more upsides or downsides for public relations specialists as they target defined audiences?

You might also enjoy: Become a Content King with Ideas from the Ultimate Content Creator

*Source: Audit Bureau of Circulations

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About creativeconsiderations

Christine Sullivan is a communications strategist with expertise in communications planning, writing and content development, and executive communications. She can be reached at mycreativeconsiderations@gmail.com.
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